The shares were up 1.5% at 794.50p at 14:55 in London, making Tate & Lyle the third-strongest gainer in the FTSE 100 index.

The analysts said they had spoken to a former chief procurement officer (CPO) for a large drinks company who supported Berenberg's view that there was no big price fall on the horizon.

"Our CPO expert commented that there was no 'cliff' in sight for sucralose. Only a breakthrough in a natural sweetener might cause this, but there is nothing even close to regulatory approval which could compete with aspartame [another sweetener] and sucralose on price and taste," the analysts wrote.

UBS cut Tate & Lyle to 'sell' on September 9th and said the company's valuation was too high when it faced the risk of falling sucralose prices that would leave it as a corn processor with volatile margins. Sucralose is a sugar-based low-calorie sweetener used in soft beverages and other food and drink products.

Berenberg said Tate & Lyle had limited exposure to price falls from a stock overhang caused by weak first-quarter soft drink sales because most of its sucralose contracts are annual rather than based on spot prices.

"Typically large customers like Pepsi and Coke enjoy a 15-20% discount over the smaller players, so these reported price decreases, if true, reflect a pricing adjustment in the market between smaller manufacturers and suppliers," the analysts said.

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